Microsoft posts more solid cloud growth with $28.9bn in overall revenue for Q218

Microsoft continues to cite the cloud as the key to its success; the company has posted revenues of $28.9 billion and operating income of $8.7bn for Q218, an increase of 12% and 10% respectively.

While the company does not give specific numbers for Azure, saying its revenue has gone up 98%, its ‘intelligent cloud’ bucket – which focuses on Azure and server products, saw revenues of $7.8bn, an increase of 15% year over year, while the ‘productivity and business processes’ segment, focusing more on Office 365 went up 24% to $8.95bn.

Despite the ever-improving cloudy outlook, the quarter did see an overall loss of $6.3bn, which Microsoft attributed to a ‘net charge of $13.8bn related to the Tax Cuts and Jobs Act.’

Satya Nadella, Microsoft CEO, told analysts the ‘intelligent cloud and intelligent edge platform [was] fast becoming a reality.’

“As intelligent cloud, intelligent edge becomes more predominant, our architectural advantage is increasingly clear to our customers,” said Nadella, as transcribed by Seeking Alpha. “You see this reflected in the latest CIO surveys, as well as in our 98% Azure revenue growth this quarter. Only Microsoft delivers hybrid consistency, developer productivity, AI capabilities, and trusted security and compliance.”

Highlights for Microsoft in the most recent quarter include a partnership with SAP to ‘provide enterprise customers with a clear roadmap to confidently drive more business innovation in the cloud’, as well as launching Azure Migrate, a free service to help organisations move over from their VMware environments.

The latter initially did not go down well with VMware, with the company saying at the time it ‘cannot endorse an unsupported and non-engineered solution that isn’t optimised for the VMware stack’. In other words, if customers took the plunge and something went wrong, they would be on their own. However, in December Microsoft posted a missive saying it was working with VMware and its cloud provider program partners for an offering made generally available later this year. VMware then updated its blog post removing the more antagonistic language, saying it was ‘in the process of engaging with the partner to ensure compliance and that the appropriate support model is in place.’

You can read the full financial report here. Watch this space however, as Amazon Web Services (AWS) posts its financials later today.

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